The alarmingly sluggish disbursement of official development assistance (ODA) capital and foreign soft loans continued to be the topic of a teleconference in Hanoi on September 13.

The event gathered representatives of the five ministries with the biggest ODA and foreign soft loan allocation plans, namely the ministries of transport, agriculture and rural development, education and training, natural resources and environment, and health. It was also attended by representatives of the administrations and management boards of projects using ODA and preferential loans in the 63 provincial-level localities.

The teleconference on the ODA and foreign soft loan disbursement in Hanoi on September 13

Minister of Finance Dinh Tien Dung pointed out the “very slow” disbursement of public investment capital, ODA capital and foreign soft loans in recent years.

From 2016 to 2018, the investment capital disbursed from ODA and foreign soft loans was 137.176 trillion VND (about 5.9 billion USD), equivalent to 74.53 percent of the plan assigned by the National Assembly. The rate in the first half of this year was only 3.4 percent of the target for 2019.

The public investment capital allocated from the state budget was some 161.286 trillion VND between January and August, equivalent to 37.92 percent of the target set by the National Assembly.

During the same period, only 6.48 trillion VND of ODA and foreign soft loans was disbursed, equivalent to just 10.7 percent of the allocation plan.

As many as 35 ministries, sectors and provincial-level localities didn’t have any of their foreign capital disbursed in the eight months. Meanwhile, those with worryingly low disbursement rates include the Ministry of Education and Training (5.8 percent), the Ministry of Health (4.8 percent), Quang Ninh province (0.5 percent), Quang Nam province (2.3 percent), and Hung Yen province (8.3 percent), according to the Finance Ministry.

Minister Dung blamed the snail’s pace of the disbursement on several problems, including the lagged issuance of medium-term public investment plans for ministries and localities, capital allocation yet to match the reality, prolonged procedures, projects’ low readiness, and hindrances to site clearance and corresponding capital preparation.

At the meeting, the Finance Ministry proposed the Government assign the Ministry of Planning and Investment (MPI) to promptly work with relevant ministries and sectors to build a new decree on the management of ODA and preferential loans to replace those issued in 2016 and 2018. It said that the new decree should appoint the public debt management to a single agency and focus on the simplification of related procedures.

It also asked the MPI to coordinate with the relevant sides to review the implementation of the medium-term public investment plan for 2016-2020 so as to adjust and allocate capital for the projects in need of funding in a timely manner to ensure that the plan is fulfilled.